Rape charges against former St Kilda AFL player Stephen Milne have been dropped after the 34-year-old pleaded guilty to a lesser charge.

Milne was to go on trial this month in the Victorian County Court, charged with three counts of rape, over an alleged incident involving a 19-year-old woman at then St Kilda team-mate Leigh Montagna's home in 2004.

But appearing in court this morning, the 34-year-old instead pleaded guilty to one charge of indecent assault.

At a plea hearing, Milne's lawyer told the court the last 10 years have been an "awful time" for his client and his family, because Milne is often publicly labelled a rapist.

His lawyer described Milne as 10 years older now and "a heck of a lot wiser".

The court heard Milne and Montagna met up with the victim and a friend after a club family day on the day of the assault.

Milne had been drinking heavily.

The court heard Milne and the friend and Montagna and the victim then had consensual sex in separate rooms before Milne and the other woman went to Montagna's room.

The two couples then engaged in more consensual "sexual activity" before Milne later attempted to have sex with the victim.

At a pre-trial hearing in 2013, prosecutors told the court the incident took place in a darkened room at Montagna's house, and the woman believed the man kissing her was Montagna, not Milne.

The woman told the court she repeatedly asked Milne to stop and when she realised who it was she felt sick and immediately left the room.

His lawyer, Phillip Dunn QC, told the court Milne believed the victim knew who he was.

"He was ... confident, given the circumstances, that she knew exactly who he was," Mr Dunn said.

But Mr Dunn acknowledged the woman could not see in the dark and believed Milne was Montagna.

"I want to make it very clear. She said no," Mr Dunn said.

Milne listed his occupation as unemployed and Mr Dunn said he found it impossible to find work anywhere, including in football because of the rape allegations.